Ousted CG Power Chairman Gautam Thapar Sends Legal Notice To Company Board Contesting His ‘Illegal’ Removal

The ousted chairman of CG Power & Industrial Solutions, Gautam Thapar, has sent a legal notice to the company board through the law firm Shardul Amarchand Mangaldas & Company, contesting his removal which he has called “illegal”.

Thapar was ousted as chairman on August 29 after a multi-crore rupee financial scam was revealed by whistleblowers and the company’s board accused him of siphoning off funds from the company.

Incidentally, the company’s chief financial officer V G Venkatesh who has also been sacked was prevented from leaving the country through Mumbai airport on September 7, after lookout circulars (LoC) was issued against him and Thapar by the Ministry of External Affairs after a request by the Ministry of Corporate Affairs.

Both Venkatesh and Thapar have been questioned by Ministry of Corporate Affairs officials.

Meanwhile the company board has submitted details of all transactions, which allegedly involved shell companies, to the Ministry of Corporate Affairs, which has passed them on to the Enforcement Directorate.

The financial damage to CG’s balance sheet is now estimated to be in excess of Rs 3,000 crore and there is a possibility of the Serious Fraud Investigation Office (SFIO) probing the matter.

Transactions worth Rs 2,000 crore are unexplained and these are being already being probed.

However, Thapar has accused the company board of not involving him in the probe and rejected the accusations of fraud, claiming that the funds were used to pay bank loans.

In this connection, it may be recalled that the company CEO and managing director K N Neelkant was sent on leave by the board on May 10 to enable investigations into alleged financial irregularities. He will remain on leave until further clarity emerges after the end of an ongoing Deloitte’s forensic audit.